The Whyalla steelworks in South Australia will shed more than 500 jobs after its blast furnace repeatedly failed to fire, administrators KordaMentha confirmed. The workforce across the steelworks, its port, and the associated mine will fall from 1700 to about 1200 employees, with an additional 100 labour hire workers also losing their positions.
Blast furnace failure ends revival efforts
The decision to abandon further attempts to restart the 60-year-old coal-fired blast furnace, which has been offline since April, will effectively shut down most operations at one of Australia's two remaining steel facilities. The Whyalla plant is the last Australian steelworks to manufacture rail steel on shore.
South Australian Premier Peter Malinauskas said the blast furnace's "days were numbered" and that while the government hoped it would last longer, it had not been able to. He confirmed redundant workers would receive their full entitlements, alongside a $10 million state and federal government package to support re-skilling and training.
Administration and ownership history
The Whyalla steelworks were part of British industrialist Sanjeev Gupta's metals empire until early last year, when the South Australian government placed the operations into administration following years of underinvestment. The state government said at the time that upgrade promises, including plans for an electric arc furnace to replace the ageing coal-based system, were repeatedly unfulfilled.
The federal and state governments unveiled a $2.4 billion support package to keep the plant running, pay employees and creditors, upgrade infrastructure, and ultimately attract a new buyer to reinvigorate the plant.
Economic impact on Whyalla
KordaMentha partner Sebastian Hams said efforts by workers to keep the blast furnace operating over many years should be commended. "This is a difficult decision, but it is a necessary one as the company transitions to modern steel making technologies," Hams said.
Whyalla's mining and steel operations form the economic foundation of the city, supporting numerous workers and local businesses from contractors to cafes. Operations will now be severely restricted, with the plant relying on stockpiles and externally sourced semi-finished steel products to keep manufacturing going. Port operations will continue.
Administrators hope to sell the business without an operational blast furnace. Australian-based M Resources, Indian company Jindal Steel, and BlueScope Steel were among potential suitors.
